CESTAT Mumbai Bars Customs From Rejecting Declared Value, Upholds Relief For Adani Entities

On 5 June, the Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that customs authorities cannot reject the declared transaction value of imported goods when they rely on allegations of overvaluation arising from the same Directorate of Revenue Intelligence (DRI) investigation and evidence that earlier proceedings had already rejected and the Supreme Court had affirmed. President Justice Dilip Gupta and Technical Member P. Anjani Kumar dismissed six appeals...

CESTAT Delhi Holds Importer Entitled To PCBA Exemption Under 2005 Customs Notification, Sets Aside Duty Demand

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi, has recently set aside a customs duty demand of ₹1.14 crore against Magic Mike Enterprises Pvt. Ltd. A Bench of President Justice Dilip Gupta and Technical Member P.V. Subba Rao held that the company was entitled to an exemption under a 2005 customs notification for certain printed circuit board assemblies (PCBAs), as the imported goods were not used to manufacture the categories of telecom and networking products...

Procedural Defects In Invoices Cannot Defeat SAD Refund Entitlement: CESTAT Chennai

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, has allowed an appeal filed by Cape Electric Corporation and set aside orders rejecting Special Additional Duty (SAD) refund claims of ₹18.82 lakh. The claims arose from imported goods that were subsequently sold in the domestic market on payment of VAT. The Division Bench of Judicial Member Ajayan T.V. and Technical Member Vasa Seshagiri Rao held that the department could not deny the refund claims on the basis of...

CESTAT Delhi Sets Aside Redemption Fine In Ketamine Export Case As Goods Not Available For Confiscation

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, has set aside a redemption fine imposed in connection with the export of ketamine to China after holding that the goods had already been exported and were no longer available for confiscation. Technical Member Rajeev Tandon partly allowed the appeal. He, however, upheld the appellant's liability for his role in the export operation and reduced the penalty imposed on him to ₹5 lakh. The Tribunal held, “The fact...

CESTAT New Delhi Sets Aside ₹1.44 Crore Customs Duty Demand Against Bharti Gems, PP Jewellers

On 3 June, the New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) set aside a customs duty demand of Rs.1.44 crore, along with confiscation of goods and penalties imposed on P P Jewellers & Diamonds Pvt. Ltd., Bharti Gems, Its My Name Pvt. Ltd. and related parties, holding that the Customs Department failed to prove diversion of duty-free imported gold and silver or any fraudulent export activity. President Justice Dilip Gupta and Technical Member P.V. Subba...

CESTAT Mumbai Upholds Duty Exemption On Edible-Grade Oils Imported For Cosmetic, Pharmaceutical Use

The Mumbai Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has dismissed a Revenue appeal challenging customs duty exemption granted to Pioma Chemicals on imports of refined peanut oil, sunflower oil, walnut oil, almond oil and macadamia nut oil. The tribunal held that the benefit could not be denied on the ground that the oils were intended for use in cosmetic and pharmaceutical products. A bench of Judicial Member Dr. Suvendu Kumar Pati and Technical Member M.M....

Customs Cannot Deny FTA Benefits By Unilaterally Discarding Certificate Of Origin: CESTAT Chennai

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 2 June held that Customs authorities cannot unilaterally reject a valid Certificate of Origin (CoO) issued by a foreign authority and recompute local value-added content (LVAC) using a methodology not prescribed under law. Judicial Member P. Dinesha and Technical Member Vasa Seshagiri Rao held that authorities cannot deny preferential tariff benefits under a free trade agreement by bypassing the Rules of...

CESTAT Sets Aside ₹70 Lakh Penalties In Cigarette Smuggling, Faults DRI For Incomplete Investigation

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 2 June held that a penalty for abetment under Section 112(a) of the Customs Act cannot be sustained without identifying and establishing the liability of the actual importer. Judicial Member P. Dinesha set aside the penalties of Rs.35 lakh each, imposed on B.A. Suresh Kumar, proprietor of Arunachalam Shipping, and C. Solomon Selvaraj, proprietor of Thivya Agencies in an alleged cigarette smuggling case...

Customs Broker's Failure Of Due Diligence May Attract Penalty, Not Licence Revocation: CESTAT Chennai

On 2 June, the Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), held that authorities may penalise a customs broker for failing to exercise proper supervision and due diligence, but cannot revoke a customs broker licence in the absence of evidence showing deliberate involvement in fraud. Technical Member Vasa Seshagiri Rao and Judicial Member Ajayan T.V., while hearing appeals arising from a Directorate of Revenue Intelligence (DRI) investigation into alleged...

CESTAT Principal Bench Sets Aside Interest, Penalty On EPCG Defaulter After Lenders Auction Imported Goods

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) at Delhi has set aside the confiscation of imported capital goods and the levy of interest and penalty imposed on Rajdarbar Heritage Venture Ltd. The tribunal found that the company could not fulfill its export obligation under the Export Promotion Capital Goods (EPCG) Scheme because the imported goods and hotel premises were auctioned by lenders. A bench of President Justice Dilip Gupta and Technical Member P.V. Subba...

CESTAT Upholds Classification of AKD Wax Imported by Arjun Chemicals as Wax Product

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has upheld the Customs Department's classification of Alkyl Ketene Dimer (AKD Wax) imported by Arjun Chemicals Pvt. Ltd. under the tariff entry applicable to wax products. However, the Tribunal held that Customs authorities could not invoke the extended limitation period because they had accepted the importer's classification of the product for several years. It therefore restricted recovery of differential...

CESTAT Chennai Backs Load-Port CE Certificate Over Local CE Report, Restores Declared Import Value

The Chennai Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has set aside Customs authorities' enhancement of the value of imported second-hand machinery after finding that the enhancement was based on a local Chartered Engineer's certificate that did not disclose the basis for the revised valuation. A bench of Judicial Member Ajayan T.V. and Technical Member Vasa Seshagiri Rao observed that Customs authorities had discarded the load-port Chartered Engineer's...